What I Have To Say About The Economy & Credit

Main menu

Monthly Archives: August 2015

Post navigation

HOW will the Cebu City Council persuade the public against supporting a plan to pay for the entire balance of the South Road Properties (SRP) loan now?

It’s a tricky proposition to defend, considering that freeing the City from its debt seems to be the most logical thing to do now that it has more than P2.42 billion to spare.

Last March, before the City received its latest windfall from the SRP, Mayor Michael Rama said he was pursuing a plan to pay off the balance for the SRP debt this year, even if it meant taking out another loan. In March last year, he also brought up the idea of converting the yen-denominated loan into a domestic one, to cut foreign exchange losses. Yes, the mayor has been singing this song for some time now.

Now that the City has P8.3 billion–the partial payment for some 45 hectares of reclaimed land–there won’t even be a need to borrow. At the level of the household or the individual, the next move seems obvious: have windfall, pay off all debt.

The biggest risk for the City would be a slap on the wrist from the Department of Budget and Management and the Commission on Audit, for exceeding the cap on debt servicing this year. But what’s a couple of adverse opinions, when compared with the dramatic flourish of paying for a large debt 10 years ahead of schedule?

When the Council takes up next week the proposed supplemental budget, which includes P2.4 billion for the SRP balance, the majority’s ability to sell a difficult position will be tested.

As far as dealing with debt is concerned, local governments in our country have always tended to be conservative. The Bureau of Local Government Finance once pointed out that from 2001 to 2009, sub-national debt levels were low enough that only 2.39 to 3.29 percent of local government expenditures went to debt servicing.

Add to that the speculation that if it does oppose paying for the entire SRP balance now, the council majority would do so mainly to keep Team Rama from having a significant advantage heading to the 2016 elections. Not all debt is bad, especially if local governments use it for projects that will earn long-term revenue. But good luck selling that position to voters.

Filing for bankruptcy has created a challenging environment for the debtors workforce, the request says, and so these managers are needed to make sure operations continue in a way that maximizes value for creditors.

The promised payments create an incentive, according to the Colt chief restructuring officer, for key employees to do bankruptcy-related work in addition to their day-to-day duties, and to keep them from quitting before the company emerges from bankruptcy.

California voters’ support for extending health care coverage to people in the state illegally is gaining ground, according to the latest Field Poll.

The survey found that 58 percent of registered voters favor providing Medi-Cal to all of the state’s undocumented residents while 39 percent oppose. Last year, only a slight majority – 51 percent – favored the idea, while 45 percent opposed.

And in a year largely bereft of statewide electioneering, approval of the 5-year-old federal health care overhaul continues its upward march.

Though Obamacare still divides voters along party lines – with Democrats supportive and Republicans opposed – it is now for the first time backed by majorities of voters in every major region of the state; along with all age groups, races and ethnicities. Opinions of the law improved most among Latinos, adults in their late teens and 20s, and residents of Los Angeles County.

“We are moving further away from perceptions about what the law has done and toward how it actually works,” said Mark DiCamillo, director of the poll. “The initial fears that some people had that it would hurt them have dissipated a bit.”

Overall, some 63 percent say the state’s Medi-Cal program is important to them and their families. Meanwhile, expanding Medi-Cal coverage for unauthorized immigrants has emerged as a priority for some Democratic lawmakers even as Gov. Jerry Brown and others have expressed reservations about the projected cost. Under the budget deal forged by Brown and the Legislature, the state is extending Medi-Cal to children under 19 regardless of their legal status.

“Democrats seem to be warming to that idea more and more,” DiCamillo said of offering Medi-Cal to all.

Separately, a bill seeking a federal waiver for unauthorized immigrants to obtain health insurance through the state exchange could be taken up this week by the Assembly’s fiscal committee. New enrollees would not be allowed to receive subsidies to defray the cost of their plans.

The Affordable Care Act’s supporters outnumber opponents nearly 2-to-1, 62 percent to 33 percent. Democrats approve of the law 85 percent to 11 percent. For 51-year-old poll respondent Kate Maher of Magalia, in Butte County, “acquiring health insurance was imperative” after being on and off various plans since 2001. The law allowed her to get better, more consistent health care, Maher said, noting she has diabetes and can’t be denied coverage.

Maher said she’s out of work, so government subsidies help cover much of her monthly premium payments. She said she doesn’t think everybody should get a “free ride,” but for those like her who physically cannot hold down jobs, Obamacare has been something of a safety net, even though “it’s not perfect.”

“We will get though the stumbles, and I think we largely have,” Maher said of the negligible hitches she experienced. “It is just going to get better and better.”

Republicans unsurprisingly remain its staunchest opponents, 68 percent to 25 percent. Respondent Stephanie Griffin, a retired schoolteacher from Redding, said she strongly opposes the law based on the experiences of friends and neighbors.

People are still experiencing financial hardships and filing for bankruptcy because they can’t afford to pay for medical coverage, said Griffin, 71. She said the overhaul has not made coverage affordable enough.

Griffin said a former student of hers enrolled in the state’s health insurance exchange has had trouble gaining access to physicians. And Griffin added that another patient she knows said they were scolded by a doctor for asking about a second ailment during an appointment.

“Obamacare has made people’s lives more difficult,” she said.

Still, a growing majority of voters in the poll, sponsored by the California Wellness Foundation, think the state has successfully executed the law, with upbeat assessments about its implementation cutting across party lines. Californians also largely agree (74 percent to 22 percent) with the US Supreme Court’s June ruling upholding the law’s subsidies. Now, nearly a 2-1 majority believe its major provisions likely will remain on the books in perpetuity.

Peabody Energy Corp. hiredLazard Ltd. to advise the coal miner how to restructure its $6.3 billion of debt, according to two people with knowledge of the matter.

The largest US coal producer, which is suffering from a collapse in demand for the commodity, istalking to creditors about ways to cut its debt load, includingswapping obligations for new shares or convertible notes, said the people, who asked not to be named because the conversations are private. That kind of arrangement could allow the company to avoid filing for bankruptcy, which other miners have done in the current coal slump.

The company has engaged Jones Day as legal counsel, the people said. Debtwire previously reported that hiring.

Finances in a marriage means more than knowing how much each person makes and paying the bills. Not having a grasp on money management in a relationship can spell disaster. In fact, couples who fight over money once a week are 30 percent more likely to get divorced, according to a Utah State University study.

The top six money arguments that end marriages include how to merge money, dealing with debt, investing, budgeting, lying about money and emergency planning.

If there is a delay in filing for insolvency, the managing director of a GmbH is liable.
According to the German Federal Court of Justice (Bundesgerichtshof (BGH)) in its judgment of
December 18, 2014, this also applies to a de facto managing director.

GRP Rainer Lawyers and Tax Advisors in Cologne, Berlin, Bonn, D??sseldorf, Frankfurt, Hamburg,
Munich, Stuttgart and London www.grprainer.com/en conclude: In the instant case, the de
facto and the actual managing directors of a GmbH were convicted by the Regional Court of Dortmund
for deliberately delaying filing for insolvency and aiding and abetting in delaying filing for
insolvency. The appeal was dismissed by the BGH (Az. 4 StR 323/14 and 4 StR 324/14).

The Karlsruhe judges pointed out that the long-standing jurisprudence of the BGH recognising the
criminal liability of the de facto managing director where there is a failure or a delay in filing
for bankruptcy or insolvency remains valid, even in light of the reorganisation of sec. 15a para. 4
of the German Insolvency Code (Insolvenzordnung). According to this, those who incorrectly,
belatedly or omit to submit an insolvency application will be punished. An insolvency application
needs to be submitted by the representative bodies of an insolvent or over-indebted legal person
without undue culpable delay, but no later than three weeks after insolvency has occurred or said
legal person has become over-indebted. The judges stated that de facto managing directors are not
exempt from this.

The punishments for delayed filing for insolvency can be considerable, ranging from financial
penalties to custodial sentences.

Managing directors are essentially tasked with conducting business for the good of the company.
They cannot be legally charged for economic failure resulting from this. However, the situation is
different if they have breached their obligations as managing directors. They can then be faced with
damages claims.

The obligations of a managing director include managing the economic and financial affairs of the
business. If he neglects this responsibility, he might render himself liable vis-??-vis the company
(internal liability). Excessive risk, disregarding instructions of the partners and, of course,
fraud and breach of trust are examples of relevant breaches of duty.

The managing director is subject to external liability if he, for instance, fails to ensure that
social security contributions or taxes are duly paid. Furthermore, he is obligated to file for
insolvency in due time if the circumstances so require. If he breaches these obligations, he may be
faced with claims for damages from third parties (external liability).

The contract between the company and the managing director is crucial to reducing the risk of
liability. That is why lawyers who are experienced in the field of company law ought to be consulted
when drafting agreements.

On 13 August 2015, the Competition and Markets Authority (CMA) announced that it has made the Payday Lending Market Investigation Order 2015, which comes as a result of the CMAs market investigation into the supply of payday lending in the UK. The Order prohibits online payday lenders from supplying payday loans unless the lender has published information on a payday loan price comparison website authorised by the FCA. In addition, with effect from 13 August 2016, payday lenders will be prohibited from supplying payday loans unless customers are provided with a summary of the cost of borrowing. The Order is intended to increase price competition between payday lenders and help borrowers.

The CMA is also welcoming steps taken by the FCA, particularly in relation to improving the disclosure of late fees and other additional charges, helping customers to shop around without unduly affecting their ability to access credit and improving real time data sharing between lenders and credit reference agencies.

LOS ANGELES, Aug. 14, 2015 /PRNewswire-iReach/ — Student loans, the fastest-growing type of debt in the United States, are drying up the pockets of many Americans. Student loan debt is currently around $1.4 trillion (double the amount of US credit card debt). With the cost of college education continuing to rise, SelectSLHelp strives to empower graduates to succeed in paying back their federal loans. Our highly-trained team of professionals educates students on how to get out of debt faster while building a path to financial freedom.

As students graduate and loan payments come due, many graduates consider financial support and wellness in the workplace as a key factor in job selection. Unfortunately, many graduates struggle landing a job in their field and their debt starts to pile up. Our document processing and consulting services are a great option for recent graduates dealing with debt and struggling to make payments on their student loans. Our highly-trained loan specialists are available to educate and inform you throughout the entire process.

SelectSLHelp helps students and graduates get their lives back on track with our document processing services. About 56% of millennials with current or past student loans are delaying major life events due to their overwhelming debt. Purchasing a home is the most common event people have delayed due to student loan debt, followed by retirement savings and buying a car.

These are some alarming numbers but the countrys debt problem continues to increase on a daily basis. A majority of student loan borrowers said they didnt receive enough information or advice about the potential risks of getting loans. More than 66% of millennials have this complaint. SelectSLHelp is here to help students take control of their debts and get back on track financially.

This will include EUR10bn to recapitalise Greek banks and EUR16bn in several instalments – the first of which will be for EUR13bn and will be delivered in time for Greece to repay about EUR3.2bn to the European Central Bank (ECB) by 20 August.

European Commission President Jean-Claude Juncker said the deal sent a message loud and clear that Greece will stay in the eurozone.

It comes at a political cost for Greek Prime Minister Alexis Tsipras, who has faced a rebellion in his left-wing Syriza party.

More than 40 MPs voted against him when parliament decided on the bailout agreement on Friday, after all-night talks. He managed to push it through with the help of members of the opposition.

Dutch Finance Minister Jeroen Dijsselbloem, who chaired the Eurogoup meeting where the deal was hammered out, said he was confident it would address the main challenges facing the Greek economy.

He acknowledged that dealing with debt was an important issue, especially for the IMF, but Germany has so far been vehemently against any debt haircut that would cost creditors billions of euros.

German Finance Minister Wolfgang Schaeuble told Deutsche Welle radio: Outright debt forgiveness doesnt work at all under European law.

Mr Schaeuble added that there was a certain amount of room to extend maturities further, but cautioned: His room is not very big.

Germanys parliament is to hold a special session on Wednesday to decide on whether to approve the Greek bailout.